Consumer groups expose ‘ghost stores’ ripping off Australian online buyers

Online shopping has become a lifeline for many Australians, especially those who value the convenience of browsing and buying from the comfort of their own homes. 

With just a few clicks, it’s easy to find everything from groceries to gifts, saving time and avoiding the hustle of crowded stores. This growing trend has transformed the way we shop, offering greater choice and accessibility for people across the country.

But as the digital marketplace expands, so do the risks lurking behind some seemingly trustworthy offers. If you’ve ever been tempted by a Facebook advertisement for a closing-down sale or a local-sounding boutique, you could be the next target of this latest scam.

Ghost stores are fraudulent online shops that masquerade as legitimate Australian businesses. They lure shoppers with slick websites, convincing backstories, and irresistible deals on everything from clothing to sports gear. 

But behind the scenes, these stores are anything but local. In many cases, they’re run from overseas, selling poor-quality knock-offs—or, worse, taking your money and delivering nothing.

Recent investigations have uncovered more than 140 ghost stores targeting Australians, with many more likely flying under the radar.

They often claim to be based in cities like Sydney or Melbourne, but a closer look reveals addresses in Belgium, Amsterdam, or China. 

Some even reuse the exact contact details and return addresses across multiple sites, making tracking down the real operators nearly impossible.

The typical ghost store follows a familiar script:

• Fake Local Identity: They use Australian place names, .com.au domains, and stories about closing down a beloved local shop.
• Aggressive Social Media Advertising: Most victims find these stores through targeted ads on Facebook and Instagram, platforms owned by Meta.
• Too-Good-To-Be-True Offers: Deep discounts, ‘final clearance’ sales, and limited-time deals are designed to create urgency.
• Shady Return Policies: If you try to return an item, you’re often told to send it to an address in China, sometimes with instructions to falsify customs declarations, or risk losing your refund entirely.

Take the case of a Brisbane woman in her 60s who spent $350 on shoes and clothing after seeing a Facebook advertisement. The items arrived but were ‘rubbish’—cheap, poor-quality imitations. 

She was caught in a web of impossible return instructions and endless back-and-forth with the company, PayPal, and her credit card provider when she tried to get her money back. After four months, she gave up out of sheer frustration and anxiety.

She’s not alone. Many Australians have reported similar experiences, with some never receiving their orders.

Most ghost stores are built using Shopify, a popular e-commerce platform, and promoted through Meta’s advertising network. 

The Australian Competition and Consumer Commission is investigating increased complaints regarding ghost stores. 

While individual vigilance is crucial, experts say the real solution lies with the tech platforms and regulators. Australians will remain at risk until Meta, Shopify, and others take more decisive action to vet advertisers and shut down fraudulent stores.

Consumer advocates argue that these tech giants are profiting from the scams, as the stores pay for web hosting and advertising. Yet, when customers or digital marketing experts report suspicious ads, they’re often told they don’t violate policies.

Erin Turner, chief executive officer of the Consumer Policy Research Centre, called it ‘digital retail fraud’ and said platforms must do more to protect consumers. 

‘Without coordinated action from digital platforms and regulators, these fraudsters will keep gaming the system,’ she warned.

Digital marketing strategist Briony Cullin noted that social media advertising for this online store has grown in the last six months. 

She has reported advertisements for 13 various businesses to Meta. She said she was informed that the advertisements would remain active each time she reported them.

One of the ‘support’ messages Cullin received from Meta said the company processed reports using a ‘combination of technology and human reviewers’.

‘There needs to be some balance for consumers here. It’s a huge problem that they’re not taking any responsibility for, and that’s terrible,’ Cullin said.

Has a ghost store caught you or someone you know? What steps did you take, and could you get your money back? Share your story in the comments below—your experience could help others stay safe.

Also read: New Visa feature takes the reins: Will it make your online shopping easier?